After a few quiet early months at the start of the year, things got interesting in April with the news that VMware software was to be removed on 10,000 PayPal servers during the summer, according to a report in Business Insider. It was to be replaced by software from OpenStack. "PayPal's strategy is to leverage open source products and provide meaningful insight and contribution to help advance the ecosystem," explained a PayPal spokesperson.

Fast forward to July and it was bad news time for Citrix. Gartner's Magic Quadrant for x86 Server Virtualization Infrastructure came out, and guess who was in the leaders quadrant? Microsoft and VMware. And guess who wasn't anymore? That's right: Citrix and the Xen hypervisor.

Unceremoniously dumped by Gartner into the "visionaries" category, meaning it officially — according to Gartner, anyway — has a less complete vision and less ability to execute than either Microsoft or VMware. That's got to hurt, even if it wasn't completely unexpected.

The Surprise of the Summer

The surprise of the summer came when Microsoft decided to bury the hatchet with Oracle, and the two companies announced a deal. It allowed Oracle's customers to run Oracle's database and other software on Microsoft's Hyper-V hypervisor or in its Azure public cloud, and it allowed Microsoft to offer a fully licensed version of Oracle's Java, plus development tools, to its Azure customers.

But before Microsoft and Oracle could enjoy the limelight for very long, VMware made an announcement to steal the other two's thunder. In August at VMworld it unveiled its NSX network virtualization platform. This was the result of some quick work: just a year or so prior to the news, VMware had started talking about the "software-defined data center," and then it acquired software-defined networking (SDN) startup Nicira.

Twelve months on from that acquisition and Nicira's network virtualization platform had been VMware-ified and re-released as NSX: a kind of extra layer to VMware's whole virtualization ecosystem.

Microsoft's attempt to steal some limelight back involved a frozen custard van. The van, which was parked up a few blocks from the Moscone Center where VMworld was taking place, offered free custardy goodness to any visitors (and VMware staff, to Microsoft's credit) who wanted to take the short walk there. In return for the cold stuff, Microsoft staff were on hand to discuss the latest trends in storage and networking and the future of the data center — and, above all else, the company's Hyper-V hypervisor and System Center.

Sobering News That Sent Shockwaves Through the Cloud Industry

September brought some more sobering news with the announcement from Nirvanix, the public cloud storage provider, that it was about to go out of business — sending shockwaves through the cloud industry. "We are dedicating the resources we can to assisting our customers in either returning their data or transitioning their data to alternative providers who provide similar services, including IBM SoftLayer, Amazon S3, Google Storage or Microsoft Azure," was the message that appeared on Nirvanix's web site.

Come October, it was back to VMware, which this time made a surprising repositioning announcement — ostensibly away from virtualization. "The backdrop for our announcements is the emergence of public clouds like Amazon, software-as-a-service offerings like Salesforce.com, social media, and easy access to IT," Martin Klaus, VMware's Group Product Line Marketing Manager, explained at the time. "IT departments are looking to become brokers of services, and VMware is trying to facilitate that by evolving from a virtualization provider to a cloud management provider. "

The fourth and last big hypervisor supplier, Red Hat, finally made the headlines in late Autumn with the launch of Red Hat Enterprise Virtualization 3.3 — or at least the beta version of it. With this release it became clear that, having failed to grab significant market share in the bog standard server virtualization marketplace, Red Hat was aiming to leverage RHEV 3.3 to get a good strong foothold in the cloud — while beefing up its "bog standard" capabilities too.

And just a few weeks later Red Hat released the latest version of its Enterprise Linux (version 6.5). There were a number of things to make it appeal to server virtualization aficionados, including a number of new features and bug fixes in areas such as live migration, error reporting, and hardware and software compatibility.

That's quite a lot of goings on over the last twelve months, but the world of virtualization in 2013 still ends pretty much as it started: with VMware out in front, and Microsoft closing in behind.

Will Hyper-V overtake vSphere? Will Citrix regain its vision? And can Red Hat Enterprise Virtualization live up to its potential? Tune in next year to find out, and happy holidays to all Virtually Speaking readers.

Paul Rubens is a technology journalist and contributor to ServerWatch, EnterpriseNetworkingPlanet and EnterpriseMobileToday. He has also covered technology for international newspapers and magazines including The Economist and The Financial Times since 1991.